Selling online abroad can be a minefield. Different countries have different rules and regulations. We are going to run a series of blogs looking at the VAT rules in the most popular EU ecommerce destinations.
The Essential Guide to VAT for Online Retailers Selling in Spain
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Foreign companies can register for VAT in Spain without the need to form a local company.
You can also voluntarily register for VAT in Spain.
If you are based outside the EU and require a Spanish VAT registration, the Spanish tax authority require you to appoint a fiscal representative to act on your behalf.
VAT registration in Spain can happen quickly – between one and two weeks.
The Distance Selling VAT Rules in Spain
If you selling online from within the EU via your website or through the marketplaces directly to Spanish private customers, you can sell up to Euros 35,000 before you have to VAT register in Spain. At this point, you will need to VAT register and start accounting for the VAT in Spain at their 21% standard rate (or reduced rate if these apply to the goods you are selling).
Using Fulfilment Centres in Spain
However, if you are thinking of using fulfilment centres in Spain to house your stock, this triggers an immediate need to VAT register in Spain – there is no threshold to exceed. Once registered you will be obligated to file the periodic VAT returns.
Reporting
VAT returns in Spain are usually required quarterly. They also require an annual return to be submitted at the end of January the following year. VAT returns can also be monthly if turnover exceeds Euros 6 million per annum.
Intrastat Declarations
In addition to VAT returns, if your turnover exceeds the Intrastat Declaration threshold (in Spain it is Euros 400,000) you will be obligated to file monthly Intrastat declarations as well as your VAT returns in Spain.
Intrastat Declarations are statistical returns required by the EU to monitor trade between the EU member states.
Penalties
Failure to comply with local VAT regulations can result in penalties and interest being applied by the Spanish Tax Authority. Please be aware the European tax authorities are becoming more proactive in searching for non-compliant online retailers. They have set up mutual co-operation with each other and they share data.
In Spain, penalties can vary from just a warning to 20% of the value of the VAT owed.
Download The Essential Ecommerce VAT Guide_Spain so you have this information to hand as your international expansion plans take off.
What to Do Now
If you want to know more, or think you need to register in Spain, please don’t hesitate to contact us on 0207 760 7667 or email info@simplyvat.com
